In version 4.0.0.342 I find some bad behavior if the connection times out.
Past 15 seconds, the "Confirm"/[Abort] dialog ["Host has not answered for more than 15 seconds. Still Waiting... Warning: Aborting this operation will close connection!"] cannot be closed.

The host has answered: The "'user@host.dom' session password:" TextField has appeared in the "Password - user@host.dom" dialog.

However, because the "Confirm"/[Abort] dialog is still posted, you cannot type into the
Password TextField. Now, the "Confirm"/[Abort] dialog will not respond to the [Abort] PushButton and you cannot close the "Confirm"/[Abort] dialog. The application is wedged.

At this point, nothing short of rebooting the system will kill WinSCP. (That I know of.)

I will try upgrading to a more recent version ("Since 4.1" and see if this behavior improves.) Thanks,